Question 1. 1. EOQ is the optimal order quantity that will ________ total inventory costs. (Points : 5)
Question 2. 2. If fixed costs increase, but variable cost and price remain the same, the break-even point: (Points : 5)
remains the same.
may increase or decrease, depending on sales.
Question 3. 3. People who take a chance on a bonanza with a very low probability of occurrence in lieu of a sure thing are: (Points : 5)
Question 4. 4. Which steps of the management science process can either be a recommended decision or information that helps a manager make a decision? (Points : 5)
Question 5. 5. EKA manufacturing company produces part #2206 for the aerospace industry. The unit production cost of part #2206 is $3. The fixed monthly cost of operating the production facility is $3000. Next month’s demand for part #2206 is 200 units. How much should the company charge for each unit of part #2206 to break even? (Points : 5)
Question 6. 6. ________ probability is an estimate based on personal belief, experience, or knowledge of a situation. (Points : 5)
Question 7. 7. In an EOQ model, as the carrying cost increases, the order quantity: (Points : 5)
remains the same.
cannot be determined.
Question 8. 8. ________ are generally independent of the volume of units produced and sold. (Points : 5)
Question 9. 9. ________ are good for stable demand with no pronounced behavioral patterns. (Points : 5)
Longer-period moving averages
Shorter-period moving averages
Weighted moving averages
Question 10. 10. A single-channel queuing system has an average service time of 8 minutes and an average time between arrivals of 10 minutes. What is the hourly arrival rate? (Points : 5)
Question 11. 11. Mutually exclusive events are: (Points : 5)
events with identical probabilities.
events that have no outcomes in common.
events that have no effect on each other.
events that are represented in a Venn diagram by two overlapping circles.
Question 12. 12. The maximin criterion results in the: (Points : 5)
minimum of the maximum payoffs.
maximum of the maximum payoffs.
maximum of the minimum payoffs.
minimum of the minimum payoffs.
Question 13. 13. In decision making, the choice of an appropriate criterion is dependent on: (Points : 5)
the risk personality of the decision maker
the number of nodes in the decision tree.
the magnitude of the payoffs.
none of the above.
Question 14. 14. The components of break-even analysis are: (Points : 5)
cost and profit.
volume and cost.
volume, cost and profit.
volume and profit.
Question 15. 15. The term ________ refers to testing how a problem solution reacts to changes in one or more of the model parameters. (Points : 5)
Question 16. 16. A single-server queuing system has average time between arrivals of 20 minutes and a service time of 10 minutes each. Assuming Poisson arrivals and exponential service times, the utilization factor is approximately _____. (Points : 5)
Question 17. 17. A university is planning a seminar. It costs $3000 to reserve a room, hire an instructor, and bring in the equipment. Assume it costs $25 per student for the administrators to provide the course materials. If we know that 20 people will attend, what price should be charged per person to break even? (Points : 5)
Question 18. 18. The ________ is the expected value of the regret for each decision. (Points : 5)
expected opportunity loss
expected value of perfect information
none of the above
Question 19. 19. Bayesian analysis involves a(n) ________ probability. (Points : 5)
Question 20. 20. A small entrepreneurial company is trying to decide between developing two different products that they believe they can sell to two potential companies, one large and one small. If they develop Product A, they have a 50% chance of selling it to the large company with annual purchases of about 20,000 units. If the large company won’t purchase it, then they think they have an 80% chance of placing it with a smaller company, with sales of 15,000 units. On the other hand if they develop Product B, they feel they have a 40% chance of selling it to the large company, resulting in annual sales of about 17,000 units. If the large company doesn’t buy it, they have a 50% chance of selling it to the small company with sales of 20,000 units. What is the probability that Product B will being purchased by the smaller company? (Points : 5)